CARPARK IN BOOMING WEST MELBOURNE SOLD FOR $25M

A CHINESE developer has purchased a prominent West Melbourne carpark for $25million with plans to redevelop it into residential or commercial office space.

Chinese developer Holder East secured the 1,877sqm corner site on La Trobe Street which has been owned by an Indonesian syndicate for the past 15 years.

The property was the first carpark listing of 2017.

The sale is the latest in a string of high value West Melbourne listings in the past six months.

David Sia from Colliers International, who helped negotiate the deal, says this sale represents the high demand for properties in the area.

"The strong price showcases the skyrocketing demand for landbank opportunities in the city," says Sia.

"Given the size of the site, it is a strong indication of the strength of the market for land, achieving about $13,000 per sqm and representing the top end of land rates for this precinct."

Colliers says it received more than 200 enquiries about the carpark, further evidence of the high demand in the Melbourne CBD.

The purchaser reportedly has plans to redevelop on the land, turning the carpark into residential or office space.

The current site is a bare carpark space, quite desolate and ripe for opportunity in the booming West Melbourne zone.

Sia says the buyer's redevelopment plans are part of a growing trend in the area.

"The purchaser has plans for a residential or office development to activate the area, having witnessed the success of new developments, Haileybury City campus and Far East Consortium's West Side Place in close proximity," says Sia.

"Given the promising outlook for West Melbourne, Holder East understands there are some lumps in the market but does not endorse the notion of an oversupply in the city's apartment marketplace.

"It saw this substantial carpark as a solid opportunity to capitalise on the currently misunderstood market."

This is the second acquisition by Holder East in less than six months.

Recently the developer purchased a nearby King Street vacant block for $6 million.

Daniel Wolman, who also assisted in negotiating the sale, says the redevelopment is part of the stimulation and revitalisation of Melbourne's northern fringe.

"The precinct is dramatically evolving in response to the inner-city demand," says Wolman.

The City of Melbourne has plans for the precinct, including extending public transport and the tram system, to reach into the West Melbourne area.

About 1,300 new residents have moved into the West Melbourne precinct in the past five years, with a further 20,000 forecast in the next 20 years.

The Chinese demand for Melbourne properties is gaining momentum; as reported earlier this week a Chinese buyer acquired the Beach Hotel in Albert Park for $18 million.